iTunes To Expand DRM Free & Variable Pricing According To Report
IT'S OFFICIAL: SEE UPDATE HERE.
As soon as today at Macworld, Apple will announce that iTunes is expanding its DRM offering to include all of the major labels and will add variable pricing according to cNet. Over the aor downloads are also part of the deals which were concluded last week. Leaked details appear to match many of the label demands that Hypebot reported in early December.
Songs will be priced in three tiers: 79 69 cents for older catalog, 99 cents for midline product and slightly higher for some new hit tracks. Depending on how much of iTune's catalog is priced at 79 cents, Jobs may have bested Amazon and WalMart.com who have used price as part of their strategy to whittle away at Apple's dominate 70%+ download market share. How the costs and profits of the price changes will be shared between Apple and the labels is not yet public.
Who Is The Winner?
Labels got higher prices on hit product, but lowered them on catalog. Fans got DRM free msuic and over the air downloads, but have to pay more for hit product.
For two years afer calling for DRM free and over the protests of labels who publically decry his dominance, Steve Jobs negotiated an agreement that should extend his regin. If early reports prove correct, Jobs has trumped the competition with lower prices and broadened the Apple/iTunes/iPod ecosystem to include OTA downloads to the iPhone. Why would music fans want to buy their music anywhere else?
I’d look at it another way. Jobs finally caved to the labels over variable pricing, and was forced to join the rest of the music-retail world, in order to match other services that have offered DRM-free music from all the labels for months.
More importantly, though, your question about where music fans want to buy their music from is moot. Most music fans don’t buy recorded music these days at all. They download it, and spend the money on gigs, merch and festivals instead.
“Why would music fans want to buy their music anywhere else?”
Because if they could purchase it directly from the artist, the artist could lower the prices to compete with iTunes’ new prices and still keep a bigger slice of the pie than if they sold a track through itunes at the old rates.
We hear about the “democratization” of music, and it’s true that it’s far easier for artists to get their music out there than in the past. But with iTunes and other large players dominating the sales channels, it’s like there’s only two or three places you can go to vote. Worse yet is these guys get to decide who’s at the top of the ballot.
Artists need to open their own polling stations and educated their fans that they have options.